Germany should brace itself for an attack on its status as the world’s top-notch carmaker. What can hurt the car nation more than Volkswagen’s diesel scandal and threats of higher import tariffs from the Trump administration is its failure to accelerate industrial transformation in the important field of e-mobility.
As U.S. President Donald Trump threatens both China and the EU with a trade war and as the EU struggles with its centrifugal tendencies in the aftermath of Brexit, transatlantic policy coordination has become a difficult proposition, especially when it comes to dealing with a rapidly changing China.
As Beijing is more and more openly asserting its influence over political developments in Hong Kong, reactions in Europe range from despondent media coverage to outright disinterest. The British government, which used to stand out in Europe for openly criticizing Beijing’s infringements on the city’s autonomy, appears far too busy with its homemade political challenges than to care about the political future of Hong Kong.
When Donald Trump urges European countries to take on a higher share of NATO defense spending, this is more than a dispute among allies. The impact of a restructuring of NATO finances would be felt far beyond the transatlantic security structure. A U.S. retreat from its role as the main provider of global security would trigger the demise of the dollar as the world’s leading currency. This disruption in the global monetary system would impact every country that depends heavily on the U.S. dollar. First and foremost, that would be China.
Once again, North Korea’s nuclear weapons program agitates East Asia and the world. “The land of lousy options,” is how Victor Cha, Korea expert at the Center for Strategic and International Studies and the White House’s top advisor on North Korea under President George W. Bush, once dubbed the global security threat presented by the Kim regime.
When China hosted the G20 summit in Hangzhou in 2016, an article in The Guardian hailed the event as “a new phase in the nation’s global economic confidence and leadership.” There is no question that G20 was a big milestone for China, but a much more obscure event – at least for a Western audience – might end up being more pivotal for China’s ability to lead globally.
Do economic sanctions cause governments to change their political behavior or even lead to regime change? This has been a controversial topic of discussion among economists and political scientists for decades. Examples from the recent past have added new fuel to this debate. In the case of Iran, many in the West are of the opinion that the oil embargo and the subsequent enforcement of import and export restrictions led Tehran to negotiate its nuclear program. The sanctions against Russia, Syria and North Korea, however, are considered to be ineffective.
Building a model city has a long tradition among China’s reform-era leaders. Shenzhen’s rise from fishing village to manufacturing powerhouse is forever connected with the name Deng Xiaoping. Jiang Zemin tied his legacy to the development of Shanghai’s Pudong District into China’s leading financial center. Now Xi Jinping aims to connect his name with Xiongan, a sustainable and smartly planned parallel city right next to Beijing.
Under its new chairman Guo Shuqing, the China Banking Regulatory Commission (CRBC) has rolled out a series of measures to slow down the rapid rise of China’s shadow banking assets. The concern is that these unregulated assets could trigger a financial panic. But a sudden reduction in shadow banking assets could actually cause, rather than prevent, a financial panic and it could also trigger a substantial reduction of growth.